Sistema PJSFC Investor Presentation - 2019 г.
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2019 г.
Sistema PJSFC
Investor Presentation
September 2021
DISCLAIMER
Certain statements in this presentation may contain assumptions or forecasts in respect to forthcoming events within Sistema PJSFC.
The words “expect”, “estimate”, “intend”, “will”, “could” and similar expressions identify forward-looking statements. We wish to
caution you that these statements are only predictions and that actual events or results may differ materially. We do not intend to
update these statements to reflect events and circumstances occurring after the above-mentioned date or to reflect the occurrence
of unanticipated events. Many factors could cause Sistema’s actual results to differ materially from those contained in our projections
or forward-looking statements, including, among others, deteriorating economic and credit conditions, our competitive environment,
risks associated with operating in Russia, rapid technological and market change in our industries, as well as many other risks
specifically related to Sistema and its operations.
2
SISTEMA: PORTFOLIO OVERVIEW
Sistema is a publicly-traded investment holding with an OTHER ASSETS
asset portfolio representing companies across 15 high-
potential sectors in Russia POWER GRIDS RENTAL PROPERTIES
LSE: SSA MOEX: AFKS Vladimir Evtushenkov Founder and main shareholder (59.2%),
Chairman of the Board
Vladimir Chirakhov President and CEO Bashkir Power Grid Business-
Company Nedvizhimost
PUBLIC ASSETS 91% 100%
MOEX: MTSS MOEX: OZON
NYSE: MBT NDAQ: OZON
HOSPITALITY FASHION RETAIL
50,3% 32.4%
1
Leading public Leading multi-category
telecommunications online sales platform in
operator in Russia Russia Cosmos Hotel Group Concept Club
MOEX: SGZH MOEX: ETLN 100% 43%
LSE: ETLN
72.0%2 29,8% VC FUNDS
Largest vertically One of the Russia’s largest
integrated forestry holding public development and
in Russia construction companies Sistema VC Sistema Asia Fund
KEY NON-PUBLIC ASSETS 90% 83%
PHARMA AGRICULTURE HEALTHCARE РЕ FUNDS
Binnopharm Group Steppe Agroholding Medsi
3
75.3% 92,8% 95,5%
SCP Group Sistema Finance
Leading full-cycle Major agriculture holding Russia’s largest national 49% 100%
pharmaceutical holding and one of Russia’s largest healthcare chain
company land owners % - ownership stake
1
Taking into account the partial exercise of the over-allotment option in connection with stabilisation procedure after the IPO of Segezha Group PJSC and the exercise of the option by Mikhail Shamolin, President of Segezha Group PJSC.
2
As of 28 May 2021, 8.4 mln shares were issued to be used in the Ozon’s management inventive programme, taking into account exercise of all options under the programme, the effective share of Sistema, including Sistema VC, would amount to 32.4%.
3
Effective stake in Binnopharm Group, together with VTB 3
CORPORATE CENTRE’S FINANCIAL REVIEW
4
HIGH PACE OF BUSINESS GROWTH ATTRIBUTED TO STRONG DYNAMICS OF
PUBLIC AND NON-PUBLIC ASSETS
Results of portfolio companies Consolidated revenue Adj.1 OIBDA
- Revenue growth accelerated in 2Q 2021 year-on-year due to RUB bln RUB bln
strong results of MTS, Segezha Group, Medsi and Agroholding
Steppe (“Steppe”). +16,0% +6,7%
- Strong pace of OIBDA growth on the back of the performance of
MTS, Segezha Group and Medsi and despite a higher net loss at 180,0
54,8 58,5
Ozon. 155,1
Key events
- The IPO of Segezha Group took place in April 2021 on Moscow
Exchange, with a market capitalization of RUB 125.5 bln and a 2Q 2020 2Q 2021 2Q 2020 г. 2Q 2021
4
free float of 23.9%. Sistema’s stake stands at 72.0%.
- In May 2021 the Board of Directors adopted an Environmental Consolidated assets leading by
Policy and a Human Rights Policy. revenue growth in 2Q 2021 Net Corporate Centre financial
- In May 2021 the Board of Directors approved a new dividend (year-on-year) liabilities2,3
policy for 2021-2023 aimed at consistent growth of dividend
payments. The recommended basic dividend will grow every RUB bln
year and total ≈RUB 3 billion in 2021, ≈RUB 4 billion in 2022 and
≈RUB 5 billion in 2023. It is expected that, starting from 2022, 10,6%
Sistema distributes 10% of the absolute growth in its OIBDA for the +7.2%
previous year to shareholders, in the event that the Corporation
delivers absolute OIBDA growth of more than 5% for the previous
year and that the net debt/OIBDA ratio stands at no more than 44,9%
3.0x as of the end of the previous year.
- In June 2021, the Annual General Meeting of shareholders 204,4
approved the distribution of dividends totaling RUB 2,991.5 million, 190,7 195,0
60,3%
or RUB 0.31 per ordinary share for full year 2020.
- In June 2021 VTB Capital acquired 11.2% of Ristango Holding
Limited which is 100% shareholder of Binnopharm Group5, from
Sistema for RUB 7 bln. 76,6% 2Q 2020 1Q 2021 2Q 2021
1 Hereinafter please see Appendix A of the financial results press release for 2Q 2021.
2 Based on management accounts.
3 Including total volume of borrowing with the exception of cash and cash equivalents at the Corporate Centre level.
4
Including partial exercise of an over-allotment option to offer secondary shares under the stabilisation programme following the IPO as well as the exercise of options by Segezha President Mikhail V Shamolin.
5 By buying a 11,2% share in Ristango Holding Limited – which is 100% owner of Binnopharm Group
5
FINANCIAL REVIEW: 2Q 20211
Revenue: 2Q 2021
RUB bln MTS: accelerated pace of revenue and OIBDA
+16.0% growth due to increased consumption of
telecom and financial services, higher revenue
in the retail segment in part due to the effect of
12,3 7,6 2,8 2,1 0,1 180,0 a low base in 2Q 2020 when stores were shut
155,1 due to the COVID-19 pandemic, and also as a
result of a significant contribution from
enterprise digital and cloud solutions and media
products.
Segezha Group: strong growth of revenue and
OIBDA as a result of higher prices for sawn
timber and plywood amidst recovery in
demand from the construction sector,
implementation of measures to control growth
Revenue MTS Segezha Medsi Steppe Other assets, Revenue 2Q of production costs and weakening of the
2Q 2020 Group net 2021 rouble.
Adj. OIBDA: 2Q 2021 Steppe: significant increase in revenue due to
higher sales in the Field Crop and Agrotrading
RUB bln segments as a result of: ramp-up of export
volumes of agricultural products, sales of
+6.7% inventoried product from the previous year’s
harvest and higher global grain prices; positive
4,6 performance of the Dairy segment as a result of
5,6 0,7 -3.5 increased sales volumes of milk; and an
-3.6 58,5
54,8 increase in revenue in the Sugar and Grocery
Trading segment.
Medsi: increase in revenue due to recovery in
demand for routine medical care amidst
ongoing demand for services related to COVID-
19 as well as development of home and
telemedicine services; OIBDA increased due to
the revenue increase as well as due to the
effect from participation in the real estate
development project to construct the Nebo
Adj. OIBDA 2Q MTS Segezha Group Medsi OZON Other assets, Adj. OIBDA 2Q residential complex.
2020 net 2021
1Numbers may not add up due to rounding 6
CASH FLOWS AT THE CORPORATE CENTRE1
RUB bln
Monetisation of assets Investments
Buyout of minority shareholders of Ristango Holding Limited
IPO of Segezha Group
Other Other
Participation in MTS share repurchases Participation in Etalon Group SPO
Sale of stake in Binnopharm Group
+0.2 -15.3
+2.2
+13.9 +0.8 -1,2
0,8 -6,2
1,1
5,0
-7,9
7,0 -5.3
12,9
-3.2
-0,9 5,7
31 March 2021 Monetisation of Dividends and Net new Other income Investments Interest SG&A, incl. Repurchase of 30 June 2021
assets cash returns financial expenses taxes Sistema stock
liabilities
Monetisation of assets in 2Q 2021 included the sale of an equity stake in Binnopharm Group to VTB Capital (RUB 7 bln), participation in MTS’s stock
buyback programme (RUB 5 bln) and proceeds from execution of the green shoe option as part of Segezha Group’s IPO (RUB 0.8 bln).
Dividends and cash returns in the reporting period included dividends from Medsi (RUB 0.5 bln) and BPGC (RUB 0.3 bln)
Changes in the size of outstanding financial liabilities was the result of the series 001P-20 bond issue (RUB 10 bln) and repayment of bank loans as the
Corporation optimised its debt portfolio.
Total investments in 2Q 2021 amounted to RUB 15.3 bln, of which RUB 7.9 bln was accounted for by Sistema’s participation in Etalon Group’s SPO (directly
and via financial instruments) and buyout of minority shareholders of Etalon Group; RUB 1,2 bln was the buyout of minority shareholders of Ristango
Holding Limited – which is 100% owner of Binnopharm Group; and other investments, including investments in promising projects and start-ups through the
platform of funds.
The volume of Sistema’s share repurchase in 2Q 2021 amounted to RUB 0.9 bln.
Interest expenses were due to interest payments on loans and coupon payments on rouble bonds.
Numbers may not add up due to rounding.
1 Source: Management accounts.
7
CORPORATE CENTRE’S FINANCIAL LIABILITIES
Corporate Centre’s financial liabilities1
RUB bln - As of the end of 2Q 2021 the Corporation’s financial
liabilities increased modestly to RUB 210.1 bln as a result
18,0 of RUB bond placements.
207,9 -15.8 210,1
- As of 30 June 2021 RUB-denominated liabilities
New debt raised Repayment of accounted for 100% of the Corporate Centre’s financial
liabilities liabilities.
- The share of the debt portfolio accounted for by bonds
grew from 50% as of the end of 2Q 2020 to 73% as of the
end of 2Q 2021.
31 March 2021 30 June 2021 - In June 2021 Fitch Ratings upgraded Sistema’s rating to
BB with a Stable Outlook.
Corporate Centre debt
Comfortable repayment schedule Structure analysis1
RUB bln As of 30 June 2021
66,8
22,7 Bank loans & other
38,2 43,1 27%
3,3 7,2
RUB
28,9 210,1
23,2
44,1 RUB bonds bln
34,9 36,0 9,9
73%
2021 2022 2023 2024 2025 2026
Local bonds with put option2 Loans and other debt (RUB)
1 Hereinafterthe Corporate Centre’s financial liabilities are presented based on management accounts.
2RUB bond series 001Р-01, 001Р-06, 001Р-09 and 001P-10 with a put option in 2022; series 001Р-04, 001P-11, 001P-14, 001P-16 and 001P-18 with a put option in 2023; series 001Р-05, 001Р-08, 001Р-12, 001Р-13 and 001Р-15
with a put option in 2024; series 001P-7, 001P-17 and 001P-19 with a put option in 2025; series 001P-20 with a put option in 2026. 8
CONSOLIDATED FINANCIAL LIABILITIES
Consolidated financial liabilities: composition by borrower and maturity profile1,2
RUB bln As of 30 June 2021
755,7 769,4
733,8
49,9 70,8
59,5
50,8
58,8 49,9 170,8
148,8 148,0
198,3 207,9 210,1 130,7
97,7
73,5
425,2 439,1 438,6
2Q 2020. 1Q 2021 2Q 2021. 2021 2022 2023 2024 2025 Thereafter
MTS Corporate Centre Segezha Group Other - Debt and other liabilities
Structure analysis of the debt portfolio1,2
RUB bln
Eurobonds
5% 5% 4% 4%
15% 12% 18%
5% 4% 4%
90% 91% 92% 85% 88% 82%
RUB
769,4
bln Bank loans
RUB bonds and other
44% 52%
2Q 2020 1Q 2021 2Q 2021 2Q 2020 1Q 2021 2Q 2021
RUB USD Other Long-term liabilities Short-term liabilities
Numbers may not add up due to rounding
1 Including financial liabilities at the Corporate Centre, financial leases and total borrowings of portfolio companies.
2 Management accounts data are presented as of 30 June 2021
9
SG&A EXPENSES
Group SG&A expenses1 SG&A expenses: portfolio companies1 SG&A expenses: Corporate Centre1
RUB bln SG&A / Revenue, % RUB bln
8,0
18,4%
+2.7 p.p.
20,8% MTS
16,8%
7,0
18,1%
6,0
37.5
0,7 Segezha Group
17,0% 5,0
1,0 20,6%
2,5 5,4
28.1 4,0
4,2
0,5
0,5
2,6 5,4 20,3%
3,0
Steppe +2.0 p.p.
3,5 3,0%
1,5
18,6% 2,0 1,5
23,6
19,5 1,0 1,0%
9,3%
2Q 2020 2Q 2021
Medsi
10,5%
0,0 2Q 2020 2Q 2021
Group SG&A / Group revenue 2Q 2021 2Q 2020 Corporate Centre SG&A
Corporate Centre SG&A / Group revenue
MTS Corp. Centre Segezha
Other Steppe Medsi
Group SG&A in 2Q 2021 increased as a result of an The SG&A/revenue ratio declined in 2Q 2021 year- Corporate Centre SG&A and the Corporate
increase in SG&A at MTS as payroll at the retail on-year at Segezha Group and Medsi due to Centre SG&A / Group revenue increased year-
chain was up from a low base in 2Q 2020 when improved operating performance; the increase in on-year due to higher expenses as a result of
many stores were closed; Corporate Centre SG&A/revenue at MTS was due primarily to growth monetisations and due to reflection of provisions
expenses grew as a result of monetisations and in payroll on the back of a low base in 2Q 2020 under the LTI programme that had been
contributions to the LTI programme; increased when a large proportion of the chain’s retail outlets suspended in 2018 and reinstated in 2020.
SG&A at Segezha Group was due to expenses were closed due to the pandemic; Steppe’s
related to the IPO. Group SG&A / Group revenue SG&A/revenue ratio was associated with an
increased by 2.7 p.p. year-on-year to 20.8%. increased contribution to revenue from the trading
division.
1 Source: Management accounts 10SISTEMA: FOCUS ON SUSTAINABILITY
11SISTEMA: FOCUS ON SUSTAINABILITY
Sustainability management ESG Risk Rating Sustainalytics
- Sustainability is an integral element of Sistema’s activities, investment - 12.1 Low ESG risk. The best rating among Russian
strategy and long-term success. Sistema's investment criteria integrate companies and #12 among 750+ international diversified
ESG factors that reinforce the strategic approach to responsible financial companies.
investment. The Corporation was one of the first Russian companies to join
the UN Global Compact in 2002. FTSE4Good Index
- In May 2021, Sistema’s Board of Directors approved the Environmental - In 2019, Sistema confirmed its inclusion in the FTSE4Good
Policy and the Human Rights Policy, which complement the ESG Index Series.
management system and detail the provisions of Sistema's Sustainability
Policy. They set the benchmark for portfolio companies, reducing the MSCI ESG Ratings
exposure of the investment portfolio to environmental and social risks.
- Sistema improved its position and received a rating of BB
- In August 2021, Sistema was named among Top 5 global investment (on a scale of AAA-CCC) in the MSCI ESG Ratings
companies for ESG reporting according to the international ESG assessment, compared to B in 2018.
Reporting Awards 2021, organised by the leading global media platform
ESG Investing. MoEx-RSPP ESG Ratings and Indices
- Since 2016, Sistema has been included in the leaders’
Support of Segezha Group before the IPO
group of the ESG ratings compiled by the Russian Union of
- AFK Sistema provided expert support to Segezha Group in the ESG field Industrialists and Entrepreneurs (RSPP) and since 2019 has
in preparation for the IPO. The Holding approved the Sustainability been a constituent member of the new MoEx-RSPP ESG
Strategy and Policy, which focus on four key areas: innovative forestry exchange indices.
business; making Russia’s forest regions a better place to live; climate-
smart forest management and production; and a responsible forest RAEX-Europe ESG-Ranking
supply chain. The development and approval of a decarbonisation
strategy based on Science Based Targets has been identified as a - AFK Sistema is in the top-20 in the ESG-ranking of Russian
priority. companies by the RAEX-Europe rating agency.
- In April 2021, Segezha Group was included in RAEX-Europe ESG Ranking, CDP Climate Change Rating
taking 36th place out of 110 largest Russian companies and becoming
the leader among domestic companies in the forest industry. - AFK Sistema received a “B” score and is among the top-7
Russian companies that responded to the CDP Climate
- In August 2021, Segezha Group received an ESG Sustainalytics risk rating
Change questionnaire in 2020.
of 21.4 (Medium Risk), making it one of the top 25% in the Paper and
Timber industry and outperforming a number of its direct competitors.
The results of other ratings can be found at the corporate
webpage “ESG Indices and Ratings".
12KEY PORTFOLIO ASSETS
13LEADING PUBLIC TELECOMMUNICATIONS
OPERATOR IN RUSSIA
14MTS: ACCELERATED FINANCIAL GROWTH AND HIGH DIVIDEND
PAYOUTS
RUB bln1 2Q 2021 2Q 2020 YoY 6M 2021 6M 2020 YoY Revenue, RUB bln
Revenue 128.6 116.2 10.6% 252.5 233.7 8.0%
Adj. OIBDA 57.1 51.5 10.8% 112.5 103.7 8.5% +10.6%
Adj. OIBDA margin 44.4% 44.3% 0.1 p.p. 44.5% 44.4% 0.2 p.p. 128,6
Adj. net profit2 8.6 6.3 35.8% 16.7 15.4 8.7%
116,2
Net debt3 394.8 326.1 21.1% 394.8 326.1 21.1%
Capex 25.8 20.6 25.2% 55.1 40.8 35.1%
Revenue increased year-on-year in 2Q 2021 due to growth in consumption of the company’s core
2Q 2020 2Q 2021
telecommunications and financial services, growth in retail revenue owing in part to the low base effect of
Q2 2020 when stores were closed due to the pandemic, and also due to a significant contribution from digital
and cloud-based solutions for business and media products.
Adj. grew year-on-year in 2Q 2021 on the back of revenue growth due in part to an increase in telecom segment Adj. OIBDA, RUB bln
revenues and MTS Bank’s positive contribution to OIBDA growth.
OIBDA
+10.8%
Adj. increased year-on-year in 2Q 2021 due to a significant contribution from MTS Bank, the positive effect of 57,1
net profit foreign currency and derivatives operations, and decreased debt servicing costs. 51,5
Capex grew year-on-year in 2Q 2021 primarily due to increased investments in network development with a focus
on expansion of 4G networks and investments in business lines.
Outlook MTS has increased its guidance for 2021: it expects high single-digit revenue growth, at least 5% OIBDA 2Q 2020 2Q 2021
for 2021 growth and capital expenditures of RUB 100-110 bln.
Adj. net profit, RUB bln
High In August, MTS completed dividend payments for FY 2020 in the amount of RUB 26.51 per ordinary share (RUB
+35.8%
dividend 53.02 per ADR). In July, the Board of Directors recommended an Extraordinary General Meeting of
payouts Shareholders approve interim dividends for 1H 2021 in the amount of RUB 10.55 per ordinary share (RUB 21.10
per ADR). 8,6
6,3
Key In June 2021, MTS closed a transaction to acquire a 100% equity stake in OJSC Multiregional TransitTelecom
highlights (MTT), a federal provider of intelligent telecom and IT solutions for businesses.
In June 2021, Fitch Ratings affirmed MTS’s credit rating at BB+ and upgraded the outlook from stable to
2Q 2020 2Q 2021
positive.
1 MTS results reflect the divestment of NVision Group in 4Q 2020. The results for 2020 have been restated due to this divestment of Nvision Group.
2 Hereinafter net profit is presented in Sistema’s share.
3 Hereinafter net debt includes financial lease
15LEADING MULTI-CATEGORY E-COMMERCE
PLATFORM IN RUSSIA
16OZON1: EXCEPTIONAL GMV GROWTH RATE, DESPITE A HIGH
BASE FROM 2Q 2020
RUB bln 2Q 2021 2Q 2020 YoY 6M 2021 6M 2020 YoY GMV, incl. services, RUB bln
GMV incl. services2 89.0 45.8 94.4% 163.2 77.4 110.8%
Revenue 37.0 24.2 52.9% 70.4 44.2 59.5% +94.4%
Gross profit3 11.8 7.7 52.8% 23.3 12.4 88.6% 89,0
Gross profit margin 13.2% 16.8% (3.6 p.p.) 14.3% 16.0% (1.7 p.p.)
Adj. EBITDA4 (9.1) (1.8) n/a (14.0) (6.3) n/a
45,8
as % of GMV incl. services (10.3%) (3.9%) (6.4 p.p.) (8.6%) (8.1%) (0.5 p.p.)
Net loss (15.2) (3.3) n/a (22.0) (9.0) n/a
Operating Сash Flow (7.7) (2.1) n/a (19.8) (4.5) n/a
Capex 3.9 2.0 96.5% 5.9 3.1 89.3% 2Q 2020 2Q 2021
5
Free Cash Flow (12.6) (4.5) n/a (27.4) (8.5) n/a
Cash and cash equivalents 122.8 6.5 1,790.0% 122.8 6.5 1,790.0%
Gross Profit, RUB bln
GMV, incl. grew 94.4% year-on-year in 2Q 2021, reaching RUB 89.0 billion despite the high base effect from 2Q 2020,
services when COVID-19 restrictions were in place and GMV growth stood at 188%. Strong growth has continued as +52.8%
a result of order growth reached 180% year-on-year, on the back of an 80.4% increase in the customer
base and 40% higher order frequency. The number of orders reached 40.9 million in 2Q 2021, thanks to the
11,8
expansion of fulfilment and logistics infrastructure that ensures availability of a wide, high-quality assortment
and fast and reliable delivery to more than 15,000 locations, with 98% of deliveries arriving on time. 7,7
stood at negative RUB 9.1 billion in 2Q 2021, compared to negative RUB 1.8 billion in 2Q 2020. Adjusted
Adj. EBITDA as a percentage of GMV incl. services decreased to negative 10.3% in 2Q 2021, in comparison with
EBITDA negative 3.9% for the corresponding period in 2020. The key drivers were (1) Ozon’s strategic investments in
a range of high turnover categories of goods, which has boosted customer loyalty, (2) increased 2Q 2020 2Q 2021
expenditures on fulfilment and delivery associated with the launch of new infrastructure and developing a
“last mile” delivery network which have not yet reached target levels of usage, and (3) user acquisition
investments, as well as increased marketing expenses, in part on the back of a low base effect from 2Q
2020.
Operating cash stood at negative RUB 7.7 in 2Q 2021, compared to negative RUB 2.1 billion in 2Q 2020, due to growth of
flow operating expenses which were partially offset by improvements to working capital.
Cash & cash The Company had cash and cash equivalents of RUB 122.8 billion as of the end of 2Q 2021.
equivalents
1 Ozon’s financial results are not consolidated within Sistema’s financial statements. Investments in Ozon are reflected in Sistema’s financial reporting using the equity method. The share of Ozon’s profit/loss attributable to Sistema is included in Sistema’s
operating results. Investments are reflected at book value adjusted for attributable share of profit/loss for the period, and are not marked to market. As of 28 May 2021, 8.4 million shares have been issued as part of Ozon's management incentive program.
Taking into account the execution of all options as part of this program, Sistema's effective stake in the Company, including Sistema VC, stands at 32.4%.
2 GMV incl. Services is the value of goods sold on Ozon together with revenue from other services provided to buyers and sellers, inclusive of VAT minus discounts, cost of returns and cancelled orders. This figure does not take into account sales from Ozon.Travel.
3 Gross profit is defined as revenue minus cost of sales
4 Adj. EBITDA is not an IFRS metric. Adj. EBITDA is treated as a pre-tax loss, prior to the deduction of non-operating income (expenses), depreciation and option programmes expenses
5 Free cash flow is not an IFRS metric. Free cash flow is calculated as operating cash flow minus any fixed-asset acquisitions, intangible assets and repayments made on the principal debt of lease liabilities.
17OZON: GROWTH IN NUMBER OF ORDERS, DEVELOPMENT OF
MARKETPLACE, EXPANSION OF LOGISTICS INFRASTRUCTURE
Key highlights:
- Ozon continued to grow rapidly despite the high base in 2Q 2020 that was the result of to the abnormal
Number of active buyers4, mln
popularity of online shopping over the lockdown period. GMV 1 in 2Q 2021 was up 94%, and the average annual
+80.4%
GMV growth rate over the past two years was 136%, reflecting a continued trend of triple digit growth rates. The
company raised its growth guidance for GMV to 110% for the full year 2021. 18,4
- Investments in the development of high-turnover categories (primarily FMCG and fresh produce) led to an 10,2
almost 3-fold increase in the total number of orders (+180% year-on-year) in 2Q 2021. At the same time, order
frequency per user also increased: as of the end of June, each active Ozon buyer made an average of 6.6
orders a year vs. 4.7 in 2Q 2020.
- Development of the last mile delivery network has boosted both the number and frequency of orders; at the the 2Q 2020 2Q 2021
end of June, Ozon had more than 15,000 branded pick-up points across the country. Moreover, as part of its
expansion in CIS countries, the company concluded partnership agreements with Belarusian and Kazakh
national postal operators, securing nation-wide coverage of last mile delivery. Number of orders, mln
- Ozon’s trading platform continued to grow exponentially in popularity among entrepreneurs: in 2Q 2021, the
marketplace had about 50,000 active merchants2, up 3.5x year-on-year. Meanwhile, 60% of new merchant +180.1%
registrations came from entrepreneurs operating in the regions. Product improvements contributed to this influx, 40,9
namely: a large-scale reduction in sales commissions in February 2021, the expansion of logistics cooperation
models and infrastructure, the simplification of content creation and moderation procedures, as well as the
development of advertising and promotional tools. 14,6
- Marketplace GMV increased by more than 150% in 2Q 2021, while the marketplace’s share of GMV3 reached a
record 62.1%, up from 47.4% in 2Q 2020.
2Q 2020 2Q 2021
- As a result of growth in the number of merchants, the platform’s assortment increased to 27 mln SKUs. The fastest-
growing categories in 2Q 2021 were fresh produce, furniture, automotive goods, and pet products – each of
which saw their assortment increase by more than 2.5x. Marketplace’s share of GMV, %
- The development of infrastructure in the regions was an important driver of growth. In 2Q 2021, operations began +14.7 p.p.
at fulfilment facilities in Novosibirsk and Khabarovsk. The fulfilment centre in Khabarovsk will help Ozon to
62,1%
complete its strategic goal of expanding in the Far East. 47,4%
- Ozon continues to develop its financial services ecosystem. As of 30 June 2021, it had issued 1 mln Ozon cards,
holders of which place on average 1.6x more orders than users without cards. In June, the Ozon Premium loyalty
programme was updated, allowing merchants from the marketplace to now take part, where they will receive
“premium status” alongside promotional benefits.
2Q 2020 2Q 2021
1 GMV incl Services is the value of goods sold on Ozon and revenue from services rendered to buyers and sellers, inclusive of VAT, less discounts, cost of returns and cancelled orders. The figure does not include Ozon.Travel and the value of canceled orders and
discounts provided
2 The number of active sellers is the number of sellers who sold at least one product on the Ozon.ru marketplace in the previous 12 months
3 Marketplace’s share of GMV is defined as the ratio of the total value of all orders made through the marketplace (including VAT, minus discounts, the cost of returns and cancelled orders) to GMV incl. services.
4 The number of active buyers is the number of buyers who made at least one order (excluding refunds and cancelled orders) on Ozon.ru in the previous 12 months 18LARGEST VERTICALLY INTEGRATED FORESTRY
HOLDING IN RUSSIA
19SEGEZHA GROUP: LARGEST VERTICALLY INTEGRATED FORESTRY
HOLDING IN RUSSIA
Key facts1,2 One of the largest forest resources in Russia
#2 globally RUB 69.0 bn / 72% 10.2m m3
in multiwall sack paper revenue / % of revenue generated by Annual allowable cut with AAC granted
exports under current projects4 Facilities location
Sack paper
#2 globally RUB 17.5 bn / 25.3% Paper sacks
Plywood
in industrial paper sacks leadership in production costs Sawn timber (lumber)
(OIBDA3 / OIBDA margin) Glulam, pre-fab houses and
Republic of Karelia CLT
#5 globally ~3x OIBDA growth Arkhangelsk region Russia
in birch plywood since the establishment by Sistema Europe Vologda region Krasnoyarsk region
(2015-2020)
Kirov region
Kostroma region5
Denmark Moscow region6
#1 in Russia RUB 3.0-5.5 bn / 75%-100%
Netherlands Rostov region
in sawn timber fixed dividend payment (2021-2023)/ Germany Czech
dividends as % of FCF (75%-100%) from 2024 Republic
Italy Romania
Highly diversified product portfolio (% of revenue)
Turkey
52% 28% 11% 9%
2 pulp & 10 converting plants 4 sawmills
paper mills (paper sack &
Paper and Forestry Plywood Glued timber and packaging)
Packaging Management & and Boards prefabricated home kits
Woodworking
Pipeline of further value accretive projects 2 plywood mills5 1 glulam, pre-fab houses and
CLT plant
to capitalize on Segezha’s strengths ~ RUB 39 bn
(CAPEX over 2021-25 under approved business plan)
1 Rankings 4 Access to additional 2.1m m3 AAC is is contingent on the execution of agreed and approved terms of Priority Investment
are based on product capacity (as of 2020)
2 Based on FY2020 IFRS financials, 2020 results are translated at average USDRUB rate of 72.15 from 1 Jan 2020 to 31 Dec 2020, Projects in Forest Development application, as of 31 Dec 2020
5 Incl. Galich plywood mill which is under construction
share of export revenue as of 2020
3OIBDA is a non-IFRS measure. OIBDA is calculated as operating profit or loss before depreciation and amortization 6 New packaging facility in Lobnya (Moscow region) to be commissioned in 2021
20SEGEZHA: LEADING POSITIONS IN ATTRACTIVE SEGMENTS OF THE
GLOBAL MARKET WITH HIGH BARRIERS TO ENTRY
Global demand, sack paper Global demand, birch plywood Global demand, timber
Mln tonnes Mln m3 Mln m3
Sawn timber +14%
+14% +24% Glued timber +17%
8.2 417
8.0 6.2 396
7.2 5.6 364 7
6.0 6.6 5.0 322 6
6
4.2 271 5
3.2
5
358 390 410
266 317
2010 2015 2020 2025 2030 2010 2015 2020 2025 2030 2010 2015 2020 2025 2030
European demand, sack paper Global demand, bleached softwood pulp Global demand, bleached hardwood pulp
Mln sacks Mln tonnes Mln tonnes
+10% +12% +20%
29
6 554 6 064 6 015 6 198 26 27 38 42
5 633 22 24 30 35
25
2010 2015 2020 2025 2030 2010 2015 2020 2025 2030 2010 2015 2020 2025 2030
% 2020-2030
Sources: Fisher, Hawkins Wright, Poyry, RISI, Indufor, Eurosac, FAO, ISC, Woodstat, Timber-Online, HolzKurier
. 21SEGEZHA GROUP: SIGNIFICANT FINANCIAL GROWTH ON THE
BACK OF PRICE INCREASES; A SUCCESSFUL IPO
RUB bln 2Q 2021 2Q 2020 YoY 6M 2021 6M 2020 YoY
Revenue 24.5 16.9 44.9% 42.7 31.2 36.7% Revenue and OIBDA by segment
8.2 3.6 128.0% 13.2 6.2 112.5% in 2Q 2021, RUB bln
OIBDA
OIBDA margin 33.4% 21.2% 12.2 p.p. 30.9% 19.9% (11.0 p.p.)
Net profit / (loss) 4.2 3.2 32.6% 6.6 (2.1) n/a Revenue OIBDA
Net debt 28.6 47.2 (39.4%) 28.6 47.2 (39.4%)
Capex 4.7 3.4 38.2% 8.6 7.2 19.4%
FX-denominated rev., % 74.9% 72.8% 2.1 p.p. 72.8% 70.8% 2.0 p.p.
10,5
Own consumption, % 77.9% 76.7% 1.2 p.p. 80.5% 73.4% 7.1 p.p. Paper and
879.0 1,040.6 (15.5%) 1,994.0 2,722.5 (26.8%) Packaging
Total forestry, thsd cu m 3,0
increased 45% year-on-year in 2Q 2021, mainly due to recovery in demand from the construction industry, which
Revenue drove positive price dynamics across all of the Group’s product types. Revenue dynamics were also positively
impacted by increases in the average RUB exchange rate year-on-year in 2Q 2021: EUR by 12.1% and USD by 2.5%.
Forestry 7,4
grew 128% year-on-year in 2Q 2021 mainly due to an increase in prices across all of the Group’s product types, and Management &
OIBDA also due to the execution of a strategy to produce higher-margin plywood and packaging products. OIBDA was Woodworking 3,8
also significantly impacted by measures taken to curb increases in production costs, such as the development of
the Group’s own logging operations, which brought the company’s own timber supply to 78%, higher productivity,
additional logistics subsidies and a reduction in administrative costs.
Net profit increased 32.6% year-on-year in 2Q 2021 as a result of higher operating profit.
2,9
Plywoods and
boards
totalled RUB 4.7 bln in 2Q 2021, with investments aimed at implementing the Group’s approved development 1,4
CAPEX strategy, notably: the modernisation of the Segezha and Sokol PPMs, development of the paper packaging
segment (the acquisition of new converting lines), and the construction of a boiler and pellet plant in Sokol (at the
site of the Sokol Woodworking Plant).
3,6
Net debt totalled RUB 28.6 bln in 2Q 2021, a decline of 39.4% year-on-year as a result of the Company raising RUB 30.0 bln in its Other
IPO on Moscow Exchange in April 2021.
0,0
A dividend policy was approved under which the Group aims to pay up to RUB 5.5 bln per year in 2021-2023, and
Key up to 100% of free cash flow starting from 2024. The policy also provides for the possibility to increase dividends in the
highlights case of stronger markets and provided there is leverage headroom.
In August 2021, Segezha Group received its first international ESG rating from Sustainalytics, one of the sector’s
leading rating agencies. The agency assigned the Company an ESG Risk Rating of medium (with a score of 21.4,
where 0 represents the top value), which places it in the first quartile among companies in the Paper and Forestry
sector.
22SEGEZHA GROUP: PRICE GROWTH ACROSS KEY PRODUCTS
Trends across key segments Sales
Sack paper1, thsd tonnes
In 2Q 2021, Segezha Group’s paper production decreased by 7.1% year-on-year to 97,400 -20,4%
tonnes mainly due to planned renovation works at the Segezha PPM (as part of the mill’s
Sack paper approved modernisation program). Sales volumes of paper declined by 20.4% to 58,600
` 74 59
tonnes following a decrease in production volumes in 2Q 2021.
2Q 2020 2Q 2021
In 2Q 2021, Segezha sold 400.3 mln units, up 15.9% year-on-year. Recovery in demand from the Paper sacks2, mln units
construction industry was a favourable factor, driving an increase in sales of cement sacks. +15,9%
Paper sacks Production volumes increased by 14.2% year-on-year to 385.9 mln, in line with increased sales. 400
345
2Q 2020 2Q 2021
In 2Q 2021, production of birch plywood totalled 48,000 cu m, a 2.9% year-on-year decline.
Plywood Sales volumes in Q2 2021 totalled 50,400 cu m, which is 11.5% higher than the result for 2Q
Plywood, thsd cu m
2020, thanks to a recovery in demand. The company increased revenue from plywood sales
due to higher prices and high-margin products accounting for a larger share of sales. The +11.5%
45 50
increase in global prices was mainly due to deferred demand in the construction industry.
2Q 2020 2Q 2021
In 2Q 2021, sawn timber production decreased by 8.8% year-on-year to 273,000 cu m, mainly
as a result of greater volumes of marketable sawn timber from the Sokol Woodworking Plant Sawn timber3, thsd cu m
being directed towards glulam products and CLT panels. Meanwhile, sales volumes of sawn
Sawn timber timber decreased by 18.2% in 2Q 2021 following the decrease in production volumes. Global -18.2%
prices for sawn timber continued to rise, largely due to deferred demand in the construction 326
industry. 267
2Q 2020 2Q 2021
In 2Q 2021, production of glulam products and house kits grew 6.5x thanks to the launch of a Glulam and house kits, thsd cu m
Glulam products new splicing line. Sales grew 4.9x year-on-year on the back of growth in production volumes
and sales thanks to the launch of the new splicing line. Global prices continued to rise against 4.9х
and house kits 22
a backdrop of deferred demand in the construction industry.
5
2Q 2020 2Q 2021
1 Apx 42% of paper produced was supplied to Segezha Group’s own converting facilities to produce paper packaging.
2 Including 27.2 mln consumer paper bags
3 Including sawn timber produced at the Sokol woodworking plant
23ONE OF THE RUSSIA’S LARGEST PUBLIC
DEVELOPMENT AND CONSTRUCTION COMPANIES
24ETALON: ONE OF THE RUSSIA’S LARGEST PUBLIC DEVELOPMENT AND
CONSTRUCTION COMPANIES
ONE OF THE OLDEST REAL ESTATE
COMPANIES IN RUSSIA
ONE OF THE LARGEST
DEVELOPERS IN RUSSIA PROJECTS IN ST.
PETERSBURG AND MOSCOW
>30 years #6
operating in ST. Petersburg and the 6th largest developer LAND BANK SIZE
Moscow in Russia according to the
2.8
Forbes Russia ranking in 2020 m
sqm
PROVEN TRACK INTEGRATED unsold NSA
RECORD FOR QUALITY BUSINESS MODEL
as of 31.12.2020
>7
INTEGRATED
m
sqm BUSINESS MODEL
completed in core regions since from land acquisition to
inception development and property
maintenance
LAND BANK VALUE
STRONG MARKET POSITION STRONG FINANCIAL
191
IN SPB AND MOSCOW POSITION
bn
TOP
9
among developers by sales on
16.5
pre-PPA
EBITDA2
FY 2020
RUB
market value of project portfolio
+47.5% year on year, with pre-PPA as of 31.12.2020
the primary real estate market
EBITDA2 margin of 21%
in 20201
Construction Design stage Completed
1 According to DOM.RF.
2 Purchase price allocation
25ETALON GROUP: STABLE SALES GROWTH WITH A STRONG
FINANCIAL FOUNDATION
New sales New sales Cash collections
Average price +39% thsd sqm RUB bln RUB bln
growth1
+28.7% +115.2% +63.9%
24,9 22,9
122,3 13,9
95,0 11,6
Share of
mortgages in
66%
2Q 2020 2Q 2021 2Q 2020 2Q 2021 2Q 2020 2Q 2021
sales2
New sales New sales Cash collections
thsd sqm RUB bln RUB bln
New 0% +39.4% +29.6%
acquisitions3 145
thsd sqm 221,0 220,9
41,1 40,9
29,5 31,5
1H 2020 1H 2021 1H 2020 1H 2021 1H 2020 1H 2021
Net corporate
debt4 626 - Robust year-on-year sales growth for 2Q 2021, in rouble terms, primarily due to an increase in
RUB mln the share of business class projects, up from 23% to 67%. This accounts for the disparity between
monetary and physical growth figures.
- To deliver future sales growth, Etalon Group has already begun first phase sales at its flagship
“Zil-South” project, as well as second stage sales at the Nagatino i-Land project. Additionally,
sales at a business class residential complex on Moscow’s Letnikovskaya Street are expected to
begin in the near future.
- The company also aims to expand its offering via the acquisition of new projects, with some of
these set to launch in 1H 2022. In 2021, Etalon Group intends to make acquisitions with a total
selling space of 1.1 mln sq m.
1 Average year-on-year price growth for 1H 2021.
2 Shareof apartments sold with a mortgage agreement.
3 Overall selling space of the project in St Petersburg’s Pushkin District acquired by the company in 2Q 2021.
4 Net corporate debt as of 30 June 2021, as per management accounts.
26MAJOR AGRICULTURE HOLDING AND ONE OF
RUSSIA’S LARGEST LAND OWNERS
27STEPPE: ONE OF RUSSIA’S LEADING AGRICULTURE HOLDINGS
Key facts Geographical footprint
▪ Quality land in the most attractive agricultural regions of Russia
Russia
(Krasnodar, Rostov and Stavropol)
▪ Unique share of land in ownership compared to Russian peers: 85% Steppe
▪ Proximity to sea and river grain terminals
▪ Significant potential for increasing production, crop yields and OIBDA
in all M&A deals Region of
presence
▪ Focus on acquisition of assets at attractive prices vs peers
#6 in Russia 578 thsd ha / 1.4 m tonnes
in terms of farmland area2 land bank2 / collected in gross harvest
across crop types3
#1 in Russia >16 thsd / >70 thsd tonnes Expansion of Sistema's land holdings
by milk yield cows / milk production
thsd ha
>600
Top-10 2.1 m tonnes / 0.5 m tonnes +149 565
grain trading export sales / grain elevators capacity
Steppe +65 +21 +15
#3 in Russia 745 ha / 28 thsd tonnes JV
+178
in terms of apple production orchards / RZ Agro
Production of apples
380 401
+38
#1 in Russia 330 thsd tonnes
in terms of sugar and cereals wholesale trade of sugar
99
sales and cereals 12-13 14-15 2016 2017 2018 2019 2020 12'2020 … 2021E
1 Figures are based on 2020 data
2 Source BEFL.
3 Numbers with RZ Agro 28STEPPE: INVESTMENT APPEAL OF THE RUSSIAN CROP AND DAIRY FARMING
SEGMENTS
Land is cheaper than in other countries1
- The Russian agricultural land market remains
USD thsd / ha, 2020 fragmented, however the process of consolidation
continues, especially in the most attractive
5 – 40
Southern region.
- The price of arable land has the potential to grow
5 – 20 fivefold compared to global peers, especially
3-6 4-7 given recent Russian ruble depreciation, which
0.7 – 4 pushes down dollar-denominated prices and
increases returns per ha.
Russia Brazil Argentina USA Western Europe
- The cost of wheat growing in Russia remains at
record lows due to the utilisation of modern
Significant yield growth potential technologies and depreciation of the rouble.
Wheat yield, tonnes / ha, 2020
- Modernisation of the industry and advanced
4,8 technologies have significantly increased average
crop yields and improved the stability of harvests.
3,2 3,1 2,9
2
2,7 2,7
2,1 - Smaller and less efficient companies are leaving
1,7
1,3 the market, which creates great opportunities for
consolidation.
China Ukraine USA India Canada Russia Turkey Australia Kazakhstan - Currently, dollar wheat price is near its 10-year
historical lows. As soon as wheat price rebound,
Milk market dynamics in Russia the value of land assets will increase.
Mln tonnes
40,0 38,7 38,3 37,1 37,0 38,0 39,0 40,0
9,2 7,9 6,8 4,0
7,5 6,9 6,4 6,7
30,8 30,8 30,8 30,2 30,6 31,3 32,2 36,0
2014 2015 2016 2017 2018 2019 2020 … 2024
Milk production Milk imports
1All data is shown for land with above-average crop yields.
2Average for 5 years
Source: US Department of Agriculture, Rosstat, Agroholding Steppe 29STEPPE: STRONG REVENUE GROWTH AND HIGH OIBDA MARGIN
RUB bln1 2Q 2021 2Q 2020 YoY 6M 2021 6M 2020 YoY Revenue, RUB bln
Revenue 4.8 2.7 76.6% 11.6 7.6 53.0%
Adj. OIBDA 2.0 2.0 2.2% 3.2 2.7 19.2% +76.6%
Adj. OIBDA margin 41.6% 71.8% (30.3 p.p.) 27.7% 35.5% (7.9 p.p.) 4,8
Net profit 1.1 1.7 (37.7%) 1.4 1.8 (25.6%)
Net debt 29.3 24.1 21.7% 29.3 24.1 21.7% 2,7
Capex 1.0 0.5 89.4% 1.8 0.9 99.1%
Agroholding Steppe’s performance in 1H 2021 reflects the seasonal nature of the business, with the majority of
revenue and OIBDA coming in the second half of the year.
2Q 2020 2Q 2021
Revenue in 2Q 2021 grew by 76.6% year-on-year primarily due to:
- Increased revenue in the Field Crop and Agrotrading segments due to higher export volumes of
agricultural products, sales of the remainder of the previous year’s harvest and increased global Adj. OIBDA, RUB bln
grain prices;
- positive dynamics in the Dairy Farming segment as a result of increased milk sales; +2.2%
- revenue growth in the Sugar & Grocery Trading segment.
2,0 2,0
OIBDA in 2Q 2021 increased by 2.2% year-on-year due to:
- efficient sales of own and third-party agricultural products;
- growth of prices for wheat, corn and niche agricultural products;
- increase in the gross yield as a result of growth in the size of the high-productivity dairy herd in
the Dairy Farming segment;
Revenue grew faster than OIBDA due to an increased contribution to revenue from trading 2Q 2020 2Q 2021
operations.
Capex in 2Q 2021 totalled RUB 1.0 billion. The majority of capex was used to fund construction and
upgrades of dairy farms, machinery purchases and acquisitions of land plots.
Net debt in 2Q 2021 increased by 21.7% year-on year as a result of implementation of projects to increase
output of value-added products.
Key events In July 2021 Agroholding Steppe acquired a 100% stake in PIR Group, a holding company that is a
leading producer of packaged cheese in Russia and one of the largest distributors of cheese,
dairy products and plant-based alternatives.
1 RZ Agro is reflected in Steppe’s IFRS accounts as an investment in a joint venture. Agroholding Steppe’s financial results reflect the divestiture of AGK Yuzhny in May 2020. 30STEPPE: IMPROVED PRODUCTION PERFORMANCE AND INCREASED
OPERATIONAL EFFICIENCY
Trends in key segments Milk production
thsd tonnes
In the 2020/2021 season Steppe harvested record wheat volumes of 33,8 32,3
Field crops 578 thsd approximately 1 million tonnes, which will be sold starting in 2H 2021. 28,4
Land bank The share of niche crops in crop rotation also increased.
hectares 17,2 19,8 20,6
The average export price for wheat in 1H 2021 increased by 16%
year-on-year.
2Q 2020 1Q 2021 2Q 2021
Output Price per litre, RUB
The Dairy Farming segment continues to deliver steady growth of
Agrotrading sales volumes,
operating performance: the gross yield in 2Q 2021 was 20.6
Dairy farming 7.5 thsd thousand tonnes (+20% year-on-year), and the dairy herd
thsd tonnes
Dairy cows cows numbered 7,496 head of cattle as of the end of the period. +15%
Average daily productivity per cow in 2Q 2021 was 31.0 kg of milk. 1 274
1 105
Sales volumes in the Agrotrading segment for the 2020/2021 season
Agrotrading 1,274 thsd totalled 1,274 thousand tonnes (+15.2% year-on-year). An efficient 2019/2020 2020/2021
Sales volumes tonnes sales strategy and the launch of Swiss-based agricultural trading
operations drove strong financial performance. Sugar & Grocery Trading sales
volumes,
thsd. tonnes
-5%
Sales volumes in the Sugar & Grocery Trading segment in 1H 2021
Sugar & totalled 134 thousand tonnes, a slight decrease year-on-year due to 142 134
Grocery Trading
134 thsd the introduction of price caps for sugar. The company is working to
Sales volumes tonnes increase sales volumes of packaged products, and entered a new
market in 2Q 2021 with the launch of production and sales of
Steppe-branded snacks.
1H 2020 1H 2021
31RUSSIA’S LARGEST NATIONAL
HEALTHCARE CHAIN
32MEDSI: THE LEADING PRIVATE HEALTHCARE GROUP IN RUSSIA
Highlights
- Leading provider of private healthcare in Russia, offering a
complete range of services for children and adults Market Share 5% Moscow Patient visits 10 mln
2020 2020
o Medsi is #1 in Russia 1% RF
o One of Russia’s most recognisable healthcare brands; 75%
brand recognition index in Moscow
o 20+ yeas of successful operations Physicians
- Diversified infrastructure: 50 medical facilities, incl. 42 clinics, 4
Area of facilities 225 thsd m2 2020
6.5 thsd
2020
clinical and diagnostic centers, 2 hospitals, 1 wellness center and
1 sanatorium
- Fast-growing business with an extensive investment programme х – # of medical facilities
underway
Financial performance
RUB bln
St. Petersburg
Revenues Adj. OIBDA Adj. Net profit
2
12,2% 16,4% 18,6% Bryansk
1 33 Moscow Nyagan
1
6,9 3,5 4
22,3 25,0 5,9 2,9 6
Izhevsk 1
Perm
Nizhnevartovsk
1
Volgograd
2019 2020 2019 2020 2019 2020
1
Barnaul
33MEDSI: STRUCTURAL CHANGES UNDERPIN SUSTAINABLE GROWTH OF
RUSSIA’S PRIVATE HEALTHCARE MARKET IN RUSSIA
1. The Russian market is experiencing robust growth… 2. …with significant headroom for further expansion…
Healthcare services market breakdown (RUB bln)1 Healthcare spend (% of GDP)2
13.3% CAGR’17-20 17.0%
Average: 8.8% 11.2% 11.7%
10.3%
3 129
2 461 2 710 6.3%
2 033 5.0% 5.4%
3.6%
140 152 181 184
436 475 504 543
191 202 207 215
2017 2018 2019 2020 India China Russia Poland UK France Germany USA
Grey market Out-of-pocket VHI State
3. …and great potential for market consolidation… 4. …where Medsi is focused on the most attractive segment
Private healthcare sector, 2020 (Out-of-pocket and VHI) Industry revenue breakdown by segments, 2020
by revenues by revenues
CAGR ‘17-19: 9.5% 8.4%
in Russia in Moscow
Top 10 Top 10
Russia 215 RUB
3 129 184 543
3.6 tln
14%
RUB RUB 39% CAGR ‘16-19: 3.7% 6.3%
727 bln 256 bln RUB
Moscow 18 438 106 118
592 bln
Grey market State VHI Out-of-pocket
1 Voluntaryhealth insurance (VHI), mandatory health insurance (MHI), Source: BusinesStat.
2 Both
government and voluntary, including spending on medical services and goods (pharma).
Source: For OECD – OECD (2019 or latest available), BusinesStat 34МЕDSI: STRONG FINANCIAL GROWTH ON THE BACK OF RENEWED
DEMAND FOR MEDICAL SERVICES
RUB bln 2Q 2021 2Q 2020 YoY 6M 2021 6M 2020 YoY
Revenue by client type,
Revenue 7.4 4.6 60.3% 14.6 10.5 39.1% 2Q 2021
Adj. OIBDA1 1.9 1.2 60.7% 3.2 2.3 42.9%
1 6% 2%
Adj. OIBDA margin 25.2% 25.2% 0.1 p.p. 22.2% 21.7% 0.6 p.p. Insurers
Adj. net profit1 1.1 0.3 232.6% 1.6 0.7 139.4%
Individuals
Net debt2 5.2 2.9 83.8% 5.2 2.9 83.8%
Capex 1.9 1.2 59.3% 3.7 2.4 52.4% 38%
Corporates
Patient visits, thsd 2,584 1,126 129.5% 4,953 3,219 53.9% 54%
Services provided, thsd 5,773 2,258 155.7% 11,066 6,304 75.5% Other
Average ticket, thsd RUB 2.9 4.1 (29.3%) 2.9 3.3 (12.1%)
Revenue demonstrated significant growth year-on-year in 2Q 2021, due to the recovery in demand for routine medical
Revenue by assets,
care and continued demand for COVID-19-related services, including testing, CT chest scans and treatment
2Q 2021
at the Otradnoe infectious diseases clinic, and also thanks to developments in in-home care and
telemedicine. The acceleration in growth rates compared with 1Q 2021 was due to the low base effect as 2Q 7%
2020 saw a sharp decrease in patient flows as a result of restrictions introduced to combat COVID-19. Clinics* Hospitals
34%
30%
Adj. increased significantly in 2Q 2021 on the back of positive revenue growth. The Net Debt / adjusted OIBDA
CDC** Other
LTM ratio remained at a comfortable level of 1.0x. The Company’s participation in the “Nebo” residential
OBIDA development project made a RUB 0.6 bln contribution to adjusted OIBDA in 2Q 2021. Adjusted net profit rose 29%
year-on-year in 2Q 2021, driven by adjusted OIBDA dynamics.
* Primary care clinics
** Clinical diagnostic centres
Key Constructionn continued on a new medical centre on Michurinsky prospect, with a total space of more than
34 thsd sq m. The Medical Centre will include a CDC for both children and adults, a daytime in-patient clinic
highlights and a 24-hour in-patient clinic, complete with a high-tech surgery centre.
In May 2021, the CDC at Schelkovo, Moscow region, with a total space of 3,633 sq m, was launched.
Downloads of the SmartMed telemedicine app and usage of the service are actively growing. By the end of
2Q 2021, the number of downloads had increased 2.2x year-on-year. The number of appointments made
through the app, excluding instrumental and laboratory diagnostics, now exceeds appointments made
through all other channels.
In June 2021, Gazprombank provided Medsi with a RUB 2 bln credit line for a term of three years. The loan will
be used for general corporate purposes.
1 Adjusted for allocations related to the LTI programme
2 Including loan from LLC Project Michurinsky of RUB 4.8 bn
35МЕDSI: GROWTH ON THE BACK OF RENEWED DEMAND FOR ROUTINE
MEDICAL CARE, WITH DEMAND FOR COVID TREATMENT STILL HIGH
Floor space Utilisation, clinics3 Utilisation, hospitals4
Number of
facilities1 50 thsd sqm % %
+4.1% +32 p.p. +9 p.p.
55%
210,7 219,4 83% 92%
Number of
patient visits2 2.6 mln 23%
2Q 2020 2Q 2021 2Q 2020 2Q 2021 2Q 2020 2Q 2021
Patient visits Services provided Average cheque
mln mln
RUB thsd
Number of
doctors 3,800 +129% +155% -30.1%
2,6 5,8 4,1
2,9
1,1 2,3
Capacity2
5 mln visits 2Q 2020 2Q 2021 2Q 2020 2Q 2021 2Q 2020 2Q 2021
- Utilisation growth due to a recovery in the level of routine medical care, while additional
income from COVID-19 diagnostics and treatment remained high.
- Floor space growth on the back of new clinics opening in Moscow (CDCs at Marino and
Schelkovo, Clinics at Aviatsionnaya and Poletaeva.)
- A decline in average cheque size was driven by a reduction in the share of COVID-19
diagnostics and treatment services. At the same time, the decrease in the average cheque
was offset by a significant increase in patient visits and services provided.
1 Metrics in the table and elsewhere are shown as of 30 June 2021
2 Metrics are for 2Q 2021, with capacity calculated as the total number of possible outpatient visits at Medsi facilities and visits as the actual number of patient visits for the period
3 Out-patient facilities in Moscow
4 Utilisation accounts for multiple use of one in-patient bed at daytime in-patient facilities
36LEADING FULL-CYCLE PHARMACEUTICAL
HOLDING COMPANY
37BINNOPHARM GROUP: LEADERSHIP IN RUSSIA’S PHARMACEUTICAL
MARKET WITH A PRESENCE IN THE MAIN FORMS OF
PHARMACEUTICALS AND SALES CHANNELS
Binnopharm Group was established in 2020 as a result of the consolidation of Sistema's stakes in the pharmaceutical
assets. The holding company includes five modern production sites across Russia and is also the leading domestic
manufacturer of generic drugs on the Russian market1
Alium Sintez Biocom Binnopharm
Serpukhovsky District, Kurgan, Stavropol, Two sites: Zelenograd, Krasnogorsk,
Moscow Region Kurgan Region, Stavropol Krai, Moscow Region
ranks among TOP-5 over 450 ~ 420 mln
largest domestic companies on medicines in the packs per year
the Russian2 market product portfolio
25 bln rubles
over 100 over 20
pharmaceuticals listed as dosage forms
trade turnover in 2020 Vital and Essential Drugs
RUSSIA’S LEADING ANTIBIOTICS PRODUCER
1 According to IQVIA (rating of manufacturers by sales volume in the Russian market)
2 According to AlpjhaRM 381
BINNOPHARM GROUP : GROWTH OF FINANCIAL PERFORMANCE AND
DECREASED LEVERAGE
RUB bln 2Q 2021 2Q 2020 YoY 6M 2021 6M 2020 YoY Revenue, RUB bln
Revenue 5.8 5.5 5.6% 11.2 9.4 18.8% +18.8%
OIBDA 2.1 1.3 58.4% 3.7 1.7 113.1%
11,2
OIBDA margin 35.5% 23.7% 12 p.p. 33.1% 18.4% 15 p.p. 9,4
Net profit 1.3 0.6 124.7% 2.0 0.2 848.8%
Net debt 8.6 10.2 (15.7%) 8.6 10.2 (15.7%)
Revenue in 1H 2021 grew by 18.8% year-on-year, as a result of execution of diversified commercial strategy
focused on expanding Binnofarm’s product presence in different segments of pharmaceutical market. 6М 2020 6М 2021
Growth in the hospital segment in 1H 2021 expanded by 35% year-on-year in part due to strong sales of
antibiotics and medicines used to treat COVID-19. Due to successful contracting, retail sales rose 20%, OIBDA, RUB bln
notably with a significant increase in sales of products that improve quality of life: the vein tonic Venarus,
the synbiotic Maxilac and the antispasmodic Neobutin. According to the analytical agency Allpharm, +113.1%
for 1H 2021. the growth rate of sellouts (supplies to retail pharmacy chains) of the Group year-on-year
exceeded the market growth rate by 20 p.p. 3,7
1,7
in 2Q 2021and 1H 2021 delivered substantial growth of 58.4% and 113.1% year-on-year, respectively on
OIBDA the back of revenue growth, product portfolio optimization and the results of realising synergies across
the holding’s businesses, including reduction in management and commercial costs as a share of
revenue. Positive net profit dynamics in 2Q 2021 and 1H 2021 year-on-year were mainly driven by the 6М 2020 6М 2021
increase in OIBDA.
Net profit, RUB bln
Net as of the end of 1H 2021 declined year-on-year on the back of positive cash flow from operating
+848.8%
activities and as a result of efficient management of working capital.
debt 2,0
Key In May 2021 Sistema contributed the 32.4% equity stake in OJSC Sintez it acquired from JSC National
events Immunobiological Company, which is controlled by Rostec. to the equity of Binnopharm Group,
bringing Binnopharm Group’s total stake in OJSC Sintez to 88.6%. 0,2
In June 2021 wholly owned Sistema subsidiary Sistema Telecom Assets sold an 11.2% stake in the equity 6М 2020 6М 2021
capital of Ristango Holding Limited – which is 100% owner of Binnopharm Group – to VTB Capital’s
Nevsky Property Investments Limited for a consideration of RUB 7 bln.
1Binnopharm Group’s financial results are presented as a combination of the financial results of JSC Alium and JSC Sintez based on management accounts. Binnopharm Group’s financial results have been
consolidated in Sistema’s financial statements since 25 June 2021. Net profit figures are shown as 100% attributable to Sistema. Net profit is shown as excluding accrued deferred profit tax liabilities (RUB 935
million), accounted with the acquisition of Binnopharm Group’s assets.
39ONE OF THE LARGEST MANAGEMENT HOTEL
COMPANIES IN THE RUSSIAN MARKET
40COSMOS HOTEL GROUP: FOCUSED ON MOSCOW AND KEY
RUSSIAN REGIONS WITH ROBUST GROWTH POTENTIAL
Cosmos Hotel Group provides a broad range of services, from hotel concept development and design
and construction support to brand selection and hotel management
Assets : 9 hotels with over 4 000 rooms in operation
HOTELS IN RUSSIA (3,972 rooms) HOTELS OUTSIDE OF RUSSIA (150 rooms)
Own Brands International brands Resort hotels
Astrakhan Sochi Karlovy Vary, Toscana, Namibia,
Moscow Paveletskaya Italy
Izhevsk Volgograd Czech Republic Africa
Voronezh
Kazan Yaroslavl
Novosibirsk
Moscow Paveletskaya Petrozavodsk
Moscow
Kolomenskoye Moscow Yaroslavl
MOSCOW
Izhevsk
Petrozavodsk Republic of Karelia Voronezh Kazan
Volgograd
Sochi Novosibirsk
Astrakhan
Altai Republic Moscow Region
Gorno-Altaysk
41HOSPITALITY ASSETS1 (СOSMOS HOTEL GROUP)
RUB bln 2Q 2021 2Q 2020 YoY 6M 2021 6M 2020 YoY RevPar2, RUB thsd
Revenue 1.0 0.2 431.7% 1.7 1.0 65.8%
0,1
Adj. OIBDA 0.3 (0.2) n/a 0.2 (0.2) n/a Hotel Cosmos
0,8
Adj. OIBDA margin 28.1% (100.6%) 128.7 p.p. 13.3% (16.9%) 30.1 p.p.
0,9
Adj. net loss 0.0 (0.4) n/a (0.3) (0.9) n/a Russia
3,3
Net debt 3.7 4.0 (7.3%) 3.7 4.0 (7.3%)
Room capacity 4,162 4,132 0.7% 4,162 4,132 0.7% 0,9
Abroad
5,7
Revenue grew significantly in 2Q 2021 year-on-year as most restrictions imposed on hotel operations due to the COVID-
19 pandemic were lifted. Nearly all hotel operations were halted in 2Q 2020.
2Q 2020 2Q 2021
Adj. increased in 2Q 2021 on the back of partial recovery in revenue.
OIBDA
Key The share of revenue accounted for hotels outside Russia in 2Q 2021 was 15.5%.
indicators ADR3 for the Group’s hotel portfolio in 2Q 2021 increased 20.8% year-on-year and stood at RUB 3,800.
Average occupancy in 2Q 2021 increased by 41.6 p.p. to 59.2% due to the lifting of restrictions on the
operation of hotels and a partial recovery in tourist and business flows.
RevPAR2 for the hotel portfolio increased by 305% from RUB 600 to RUB 2,300 on the back of recovery in
occupancy.
Key In May 2021 Cosmos Hotel Group signed an agreement to operate Hilton Garden Inn located at 2-4
Kozhevnicheskaya Street. The opening of the hotel is scheduled for November 2021. The four-star Hilton
highlights Garden Inn Moscow Paveletskaya will offer guests 237 comfortable modern rooms. It will become the fifth
hotel of Сosmos Hotel Group in Moscow. The hotel will be the first international brand property to be
operated but not owned by Сosmos Hotel Group, in line with the company’s strategy aimed at creating the
leading hotel chain in Russia.
In June 2021 an agreement was signed to construct a hotel complex at the Sheregesh alpine ski resort in the
Kemerovo region. Investment in the project will total RUB 1.2 bln. The complex, with opening planned for early
2023, will consist of 200 guest rooms and will meet all international standards for four-star resort hotels.
In July 2021, as part of the rebranding program, the Park Inn hotels in в Astrakhan, Volgograd, Izhevsk, Kazan,
Sochi, Novosibirsk and Yaroslavl were renamed Cosmos Hotels, new service standards were rolled out and the
properties were linked to the Cosmos Travel booking system.
1
Based on management accounts
2
Revenue per available room per day
3
Average daily rate 42You can also read
